Azure Reserved Instance vs. Azure Savings Plan best use case scenario?

Hello @EnterpriseArchitect

Both Azure reservation and savings plan apply to the infrastructure part of the resource and not the license. Purchase model is same as well either monthly or upfront. Purchase is available for 1 or 3 years for both and they are billed per hour basis.

Key difference between Azure reservation instance and savings plan are as below.

1. Azure reservation is purchased for a specific region and a specific sku type ( you can have flexibility enabled however, that will only apply to the same sku family ) Only way to switch the sku type is through RI exchange
2. In savings plan for compute( as we're discussing VMs), there is a great level of flexibility where the only information that's required is choosing the scope, Azure plan amount and the term. There is no need to choose a region or sku type.

Azure savings plan will apply to maximum discounted compute resource and you can switch it to any resource based on the scope irrespective of the region or compute resource type.

In addition, for RI cancellation there is a cap of 50$ USD refund supported. However, in case of Azure savings plan once commited and cancelled the amount is forfeited.

Key benefit of Azure savings plan is that it gives a great deal of flexibility and helps reduce idle discount hours. Based on business requirements either RI or savings plan or both can be purchased to benefit at maximum level.

Hope this helps.

Regards
Divya